Ted Simons: Phoenix Mesa Gateway airport is planning a huge, 20-year expansion that will see the east valley airport go from handling 1 million passengers a year to 20 million. That's a lot of expansion for what was considered a very modest and small little airport in the east valley. Here to tell us more is Brian Sexton with the Phoenix Mesa Gateway. Good to have you here. Thanks for joining us. $1.4 billion we're talking?

Brian Sexton: Yes. At full build-out if the demand is there to require such a build-out. We have four phases. We're currently focusing on phase one, which would build a new terminal on the east side of the airport. That's $344 million, that number is a little easier to digest.

Ted Simons: Sure. How many gates are we talking about?

Brian Sexton: Initially we’re looking at 14 gates and a parking structure or parking lot which would accommodate about 4,300 cars. A little bit of interloop system that would connect the terminal building to the hog's road interchange off the San Tan 202. That would be the first phase. We would expect that to be open in 2017. Again, if that demand is there for that. We expect that our current passenger terminal will be at capacity within two years possibly if we continue to grow as fast as we have been.

Ted Simons: Why is this expansion needed at this rate, but it sounds like things really are growing.

Brian Sexton: Gateway Airport has exceeded all expectations including the airlines. There's a big demand for people to go into the smaller market cities that Allegiant serves. Spirit Airlines just started up service earlier this year, going to major cities like Dallas, Denver, Las Vegas, so we're now branched into the major markets as well. Everyone is interested in an ultralow carrier that’s operating out of Gateway and is trying to save a buck. It's just booming out there at Gateway right now.

Ted Simons: Go back to the last question. What happened out there? I remember for years the conversation was, nothing is happening out there. This airport is not taking off, so to speak. Everyone was just waiting around. A lot of big plans a lot of big talk but nothing seemed to happen. Now all of a sudden was it just getting Allegiant Airlines in there? Was that the major catalyst?

Brian Sexton: That was a major catalyst, but there were a lot of things happening in advance of Allegiant starting up there. We were renovating the existing former air force base classroom facility into a passenger terminal. We were getting a roadway system in place. Those things take years of infrastructure development. On the outside it may look like nothing was happening but inside we were busy getting it ready for Allegiant to come on board. Once they came on board in late 2007 right away we knew within two weeks it was going to be a major hit. We had to build parking facilities or parking spaces on the ramp. We had to move airplanes out of the way and start putting cars on the ramp because they were wildly popular, more so than we thought they would be. Since then we have been playing catch-up. We’re going through a construction project right now. We're going from six gates to eight, next year that will be ten. That will be our capacity. We can't build any more on the west side of the airport. It's time to build something new on the east side.

Ted Simons: What about surrounding areas? Are there development plans, retail, hotel? These kinds of things is that in the works, in the far distance?

Brian Sexton: That's the exciting part of this plan we put together. Gateway 2030 we call it. It includes $1.4 billion in public monies, the FAA and revenue bonds and things of that nature but also about another $400 million in private investment which goes towards about $2.5 million in office space, hotels up to 600 rooms. All that depends on whether or not the demand is there the next 20, 30 years. Demand is almost there right now for phase one and that’s what we’re focusing on.

Ted Simons: You mentioned the FAA and such. How is all of this funded? Talk about the public funds. Ticket surcharges I would imagine. How about the area municipalities? How much do they contribute?

Brian Sexton: The FAA typically funds 90, 95% of these types of charges but also comes from revenue from the airport, public facility charges. Every time you and I buy a ticket it's $4.50. That money is earmarked towards capital projects at an airport. We would also look into revenue bonds built on the revenue producing POC’s. The member governments, which is owned by the airport is owned by five different municipalities, who also have a responsibility to pay in a percentage of that infrastructure as well.

Ted Simons: When it's all built out what kind of airport are we going to see? Home spun, small town, is it going to be a throw-back, modern, futuristic Jetsons activity over there? Similar to Sky Harbor, different?

Brian Sexton: I think at full build-out it might be similar to Sky Harbor where you have a two-tier terminal building like terminal three or four at Sky Harbor, but what we're trying to focus on is keeping costs low. Doesn't mean cheap. We want to have a nice building we're all proud of, but we're looking to have something that's financially responsible. We are stewards of the tax dollar. We want to make sure we're doing all we can to keep the costs low. That’s actually what we’re focusing on now. We have a $340 million phase one. We want to get that cost lower. We want to focus on how we can be the best stewards of that resource. I think you'll have an easy experience at Gateway whether it's today or five or 20 years from now.

Ted Simons: Alright, good to have you. Thanks for joining us. We appreciate it.

Ted Simons: Wednesday, is the state headed for a bright, robust future or an economic dead end? A panel will discuss the future of Arizona. That's Wednesday on "Arizona Horizon," 5:30 and 10:00 right here on 8H.D. That is it for now. I'm Ted Simons. Thank you so much for joining us. You have a great evening.